Monday, July 11, 2011

National horribly miscalculate over Capital Gains Tax

The Capital Gains Tax must be driving National up the wall. One of the great myths of NZ political folk lore is that a Capital Gains Tax on property was the only sure fire way to lose the election and the following two elections.

But times have changed.

The current none ending Great Recession has refocused NZers in a way that is throwing out the pundit rule book. National took it as an article of faith that NZers did not want to borrow any longer, but missed our appetite for actual restructuring of the economy so that it can provide for all.

NZers do not want to borrow, but they also don't want to cut public services or sell off State Assets, so where to? Grow the revenue base with a capital gains tax.

National's plan to demonize the idea and claim the 4 horsemen of the Apocalypse were about to destroy NZ totally misses that many NZers support the idea and National's foaming ends up looking exactly like what it really is, the yelps of self interest from the very property speculators who are about to have their wings clipped.

You know things are terribly bad for National when a right wing flunky like John Roughan from the most right wing biased Newspaper in the country supports Capital Gains Tax...

Time to slay old demon about taxLike most of the people in polls I wasn't planning to vote Labour this year. Now? It is possible. No single issue has swung my vote before but a capital gains tax could.

Having John Roughan declare he would vote for Labour because of the Capital Gains Tax would have shocked the National Party in the way the Pope would have shocked the Vatican if he had declared he had decided to convert to Islam.

The National Party have horribly miscalculated the Capital Gains Tax, and Labour's brilliant soft sell of this has allowed National to blow all it's powder while having everyone else in society who support the idea argue for it and defend it.

4 Comments:

Did you see the poll that Bill English (or rather, his website maintenance team) ran on his website asking if people wanted CGT? It got closed it down after a few hours and replaced it with another one. Taking a look at it in his website archives will probably give you an idea why.

I'd support a capital gains tax any day over selling state owned assets. The former gives a permanent INCREASE in future Government revenue, the latter gives a ONE OFF cash injection simultaneously with a permanent DECREASE in future Government revenue. Thus if National blow the money on non-productive Government spending, as I am certain they will do, they will have made it even harder for future Governments to balance the budget.That said, ANY Government needs to understand that by definition ALL its revenue ultimately is sourced from surpluses gained from the PRIVATE sector. Their is no free lunch.